Showing Off Your Expensive Purchases on Social Media Ends Up As IRS Evidence


by Michael Lodge

My office has represented high wealth and average Joe on tax audits, what does the IRS show us at our meetings?  We get to see copies of Facebook and other social media accounts of the client with pictures of them buying stuff that are high end products.  The question is posed to us why our client can’t pay their taxes but can purchase a Rolex watch.  And that is the beginning of Exhibit A.  

The IRS has a system the goes out on the World Wide Web and gleams from every social media account you may have.  They have the ability to see everything you have put on your Facebook page of you holding up a Rolex or new $1,000 shoes.  Not only does the IRS do this but foreign taxing agencies do the same surveillance.  I have seen it with my own eyes on international tax audits and it makes my stomach go sick when representing a client.  I tell all my clients, big or small, keep your purchases to yourself and don’t share it on social media.  The IRS can allege that this client is only making so much a year but can afford GUCCI hand bags, what income isn’t being reported?  Think how an IRS agent thinks, suspect yourself, be smart about social media.

All it takes is one jealous or angry person to report a complaint with the IRS on you to the IRS, just to be mean, to get back at you, or some other reason.  The moral of this story – keep your grand purchases in the bags and leave them off of social media.

For tax help contact us at 877.778.1770